The Lean Launchpad at Stanford—Class 2: Business Model Hypotheses

3/16/11Follow @sgblank

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that Xu Cui, a Stanford postdoc in Neuroscience, had built the product to use for his own research. By the time he joined the class, the product was being used in over a hundred research organizations including Stanford, Harvard, Pfizer, the National Institute of Health and Peking University. The problem is that the product was free for end users and few Research institutions purchased site licenses. The goal was to figure out whether this product could become a company.

The Personal Libraries core hypotheses were:

  • We solve enough pain for researchers to drive purchase
  • Dollar size of deals is sufficient to be profitable with direct sales strategy
  • The market is large enough for a scalable business

Our feedback was that “free” and “researchers in universities” was often the null set for a profitable business.

If you can’t see the slide above, click here.

Personal Libraries Team Members

Abhishek Bhattacharyya (MSEE, Jun 2011) creator of WT-Ecommerce, an open source engine, Ex-NEC engineer

Xu Cui (Ph.D, Jun 2007 Baylor) Stanford Researcher Neuroscience, postdoc, BS biology from Peking University

Mike Dorsey (MBA/MSE, Jun 2011) B.S. in computer science, environmental engineering and middle east studies from Stanford, Austin College and the American University in Cairo

Becky Nixon (MSE, Jun 2011) BA mathematics and psychology Tulane University Ex-Director, Scion Group,

Ian Tien (MBA, Jun 2011) MS in Computer Science from Cornell, Microsoft Office Engineering Manager for SharePoint, and former product manager for SkyDrive

The mentors who volunteered to help this team were Konstantin Guericke and Bryan Stolle.

The Week 2 Lecture: Value Proposition

Our working thesis was not one we shared with the class – we proposed to teach entrepreneurship the way you would teach artists – deep theory coupled with immersive hands-on experience.

Our lecture this week covered Value Proposition – what problem will the customer pay you to solve? What is the product and service you were offering the customer to solve that problem.

If you can’t see the slide above, click here.

Feeling Good

Seven other teams presented after the first two (we’ll highlight a few more of them in the next posts.) About half way through the teaching team started looking at each other all with the same expression – we may be on to something here.

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Next week each team tests their value proposition hypotheses (their product/service) and reports the results of face-to-face customer discovery. Stay tuned.

Steve Blank is the co-author of The Startup Owner's Manual and author of the Four Steps to the Epiphany, which details his Customer Development process for minimizing risk and optimizing chances for startup success. A retired serial entrepreneur, Steve teaches at Stanford University Engineering School and at U.C. Berkeley's Haas Business School. He blogs at www.steveblank.com. Follow @sgblank

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